SEN. HARRY REID (D-NV), MAJORITY LEADER: we're not only not getting legislative things done now - now they're not letting us do the tax cuts and funding the government.

(END VIDEO CLIP)

OLBERMANN: Republicans continue to hold the nation hostage in order to preserve tax cuts for the rich, tax cuts for the rich that only 46 percent of Republicans even want to see extended - tax cuts that Ronald Reagan's budget director disavows. David Stockman joins us.

Where is the president on all this? He's in Afghanistan. The rumbles grow. What happens to this presidency when the Republicans are actually running the House? With Gene Robinson.

"Don't ask, don't tell" - can the service chiefs make the repeal work?

(BEGIN VIDEO CLIP)

GEN. NORTON SCHWARTZ, AIR FORCE CHIEF OF STAFF: We would execute thoroughly, professionally, and with conviction.

GEN. JAMES AMOS, MARINE CORPS COMMANDANT: We will follow the law and execute it faithfully.

GEN. JAMES CARTWRIGHT, JOINT CHIEFS VICE CHMN: I concur.

ADM. GARY ROUGHEAD, NAVAL OPERATIONS CHIEF: We can make it work.

GEN. GEORGE CASEY, ARMY CHIEF OF STAFF: I believe we can implement the policy and will implement the policy.

(END VIDEO CLIPS)

OLBERMANN: Still not good enough, says Senator McCain.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I will not agree to have this bill go forward, and neither will I believe that 41 of my colleagues will either because our economy is in the tank.

(END VIDEO CLIP)

OLBERMANN: I wonder if even he now realizes he's no longer making sense.

The Arizona death panels strikes again. She's 27. She coaches basketball at a Catholic school. And she's now off the list for a lung transplant.

(BEGIN VIDEO CLIP)

TIFFANY TATE: I'm at 25 percent. So, everything's kind of difficult.

(END VIDEO CLIP)

OLBERMANN: Tiffany Tate joins us.

The final showdown between Steve Legget (ph) and James Thurber in "A Friend of the Earth."

And he was one of the top 10 third first basemen of all time, and today, the voters let him die without being in the Baseball Hall of Fame.

All the news and commentary - now on Countdown.

(MUSIC)

(END VIDEOTAPE)

OLBERMANN: Good evening from New York. This is Friday, December 3rd, 704 days until the 2012 presidential election.

And tomorrow, Saturday, the Senate will vote on two different versions of extending the Bush tax cuts. Both votes expected to fail to get through an expected GOP filibuster since they do not extend tax cuts for the very wealthiest Americans. And even those votes will be delayed because of the objection of one anonymous Republican.

In our fifth story: the GOP extortion, as well as the White House's seeming capitulation moves onward in the deal that Senate Majority Leader Harry Reid had reached with Republicans would have included four different test votes today on extending the Bush tax cuts.

But at least one anonymous senator objected for unanimous consent catching Reid by surprise. When Reid went last night to the office of Minority Mitch McConnell to try to salvage the deal, McConnell was nowhere to be found. So, according to "The Hill," waiting for McConnell's aides to find the minority leader, Senator Reid waited in McConnell's reception area and passed the time by eating chocolates.

That is what this has come to. Senate Republicans, you'll recall, said there would be no time for unemployment insurance or the START Treaty or repeal of "don't ask, don't tell" or the DREAM Act until taxes and government funding were done. They were unanimous in their threat of a filibuster. Then one anonymous Republican slowed that down even further because he or she can.

(BEGIN VIDEO CLIP)

REID: I received a letter from all the Republicans yesterday saying we are not going to allow you to do anything legislative until we get the tax cuts resolved and funding the government. Well, Mr. President, we're not only not getting legislative things done now - now they're not letting us do the tax cuts and funding the government. So, we're going to try to work our way through this.

(END VIDEO CLIP)

OLBERMANN: But tomorrow, Senate Democrats will at least get to go on record. The two votes include an extension of middle-class tax cuts similar to what just passed the House, as well as Senator Schumer's version to extend tax cuts for every income up to $1 million.

And Senate Democrats have not missed their chance to debate the merits of talks cuts for the rich and how those dollars get spent compared to the money that goes to the jobless.

From Senator Sherrod Brown and Senator Dianne Feinstein:

(BEGIN VIDEO CLIPS)

SEN. SHERROD BROWN (D), OHIO: That money's going to get spent. So every dollar you put in unemployment generates $1.60 in economic activity which will create jobs. Conversely, a dollar in tax cuts for the wealthy, a dollar that goes to a millionaire - that dollar that goes to a tax cut for the wealthy ends up generating about 30-some cents in economic activity, creating significantly fewer jobs.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: The recovery for the richest Americans seems well under way. They are able to do well for one reason or another in this economy. But it's the income groups below them that are not - that can't get the loans, that can't meet the payrolls, whose homes are being foreclosed on, who have great difficulty surviving in this most difficult economic marketplace.

(END VIDEO CLIPS)

OLBERMANN: And yet the reports keep rolling out, including from "The New York Times" and "The Washington Post," that the White House is fully prepared to accept a two or three-year extension of economically disastrous Bush tax cuts for all income levels. And also that President Obama wants to reach a broader deal that would include an extension of unemployment insurance, possibly a one-year extension, which could affect up to 7 million unemployed Americans.

Meantime, the cohorts of former President George W. Bush, like his former communications director, Dan Bartlett, tackling today over the trap they set - well, that's their term - with the 10-year Bush tax cuts. According to Mr. Bartlett, "We knew that, politically, once you get it into law, it becomes almost impossible to remove it. It's not a bad legacy. The fact that we were able to lay the trap does feel pretty good, to tell you the truth."

Of course, those who Mr. Bartlett trapped were not the Democrats but Americans.

The new poll, 53 percent favor the middle-class tax cuts only; 67 percent against extending tax cuts for the wealthy, including the 14 percent that thinks all Bush tax cuts should expire. Not even a majority of Republicans polled favor extending the Bush tax cuts for the rich.

Which brings us to our first guest, the director of the Office of Management and Budget under President Reagan, now "New York Times" contributor, David Stockman.

Great thanks for your time.

DAVID STOCKMAN, FMR. REAGAN BUDGET DIR.: Thank you.

OLBERMANN: Should any of the Bush tax cuts be extended?

STOCKMAN: No. They should not be extended. We couldn't afford them in 2001 and 2003 when they were passed. Since then, we've had two unfinanced wars. We've had this huge stimulus, $1 trillion. We put all this money into TARP.

We have now maxed out our national credit card. We're close to the edge of insolvency in this country. And it's a farce to have a debate about extending tax cuts for the rich especially, but ultimately for anyone.

And to hear Bartlett say and chortle that we set a trap is a travesty.

OLBERMANN: Yes.

STOCKMAN: That is disgraceful what that gentleman said. And it is only a measure of how far off base both parties are, but especially the Republicans. They had a chance to cut spending for eight years, and Bush didn't veto a single spending bill.

They had a chance to cut entitlements. And what did they do? Nothing. They added Part D drug benefits, as you know - the largest entitlement expansion since the '60s.

So, what are they talking about when they say no tax cuts? That is just phony baloney.

OLBERMANN: In passing these cuts and arguing for their continuation, Ronald Reagan's tax cuts have been invoked repeatedly. Are they being invoked correctly, and are the results of those cuts being invoked correctly?

STOCKMAN: No. I think totally incorrectly. That was 1981. We had a clean national balance sheet. I remember well going in the first month, we had a raise the debt ceiling, $1 trillion.

Here we are, 30 years later, it's $14 trillion. Our economy's only grown three or four times. Our debt has grown 14 times.

Now, what happened was, we were going to cut taxes and shrink government. When it got to the job of shrinking government, what happened after a couple battles on the House and Senate floor is Republicans shrank from the battlefield. They were unwilling to put their rhetoric into action. And as a result, we've got a one-sided policy.

And the Republicans became the free lunch party of tax cuts. The Democrats became the party of defending what was there, the spending, the welfare state. We went 30 years of two parties competing to see who could give away more money. And as a result, we used up the credit card.

And that's where we are today. And it's a very dire circumstance.

OLBERMANN: So, when you hear all this go on, and as you say, Mr. Bartlett's remarks today, which offended us equally, I think, when you hear Ronald Reagan's name invoked as kind of some sort of patron saint of what has been done for the last 10 years and what is being proposed now, how does that - how does that make you feel having worked with the man on these particular issues?

STOCKMAN: Well, I feel that his legacy is being abused. Ronald Reagan believed in hard money, not money printing like the Fed has been doing for the last 10 or more years. He wanted prosperity from hard work, from investment, from entrepreneurial activity.

We've only had bubbles and booms that were based on debt and money printing at the Fed. Those are the opposite of what Ronald Reagan believed in the '60s and the '70s, and as he went into the White House.

And now, you have all of these kind of (INAUDIBLE) supply-siders who basically, I think, are totally distorting what the whole program really was about.

OLBERMANN: All right. Lastly, if you were involved in this administration, in an advisory capacity or whatever, what would you be saying to them right now? What do they have to do at all costs?

STOCKMAN: I did spend a few years in the White House, as you know, and I would take the president behind his desk. I would open the upper left-hand drawer and say, Mr. President, that's where they keep the veto pen. You haven't used it. Get it out.

And if they send you a bill that's got tax cuts for the rich in it, veto it. Take a stand and bring some discipline back to this country. If we're going to give tax breaks with Uncle Sam's credit card to the top 2 percent so they can go to Tiffany's and buy some more jewelry, where are we? We're lost.

OLBERMANN: And do you think there's anybody that has, in either party right now, the fiscal responsibility and the sense of disaster that is required to do any of these things? Or are we headed to that cliff with no chance of putting on the brakes?

STOCKMAN: Well, I think both parties are racing towards the cliff. You know, it is not change you can believe in when you're going to negotiate a big, sloppy Christmas tree bill that's going to have an extension not only to tax for the rich or the middle class but all the credit, all the business tax credits, all of this - and it's just driving us closer to the edge. It is really a sad thing to see happen.

OLBERMANN: David Stockman, former budget director for President Reagan - great thanks for your time. Appreciate it.

Let's turn now to "Washington Post" associate editor and Pulitzer Prize-winning columnist Eugene Robinson, the author of "Disintegration: The Splintering of Black America."

Gene, good evening.

EUGENE ROBINSON, MSNBC POLITICAL ANALYST: Good evening, Keith.

OLBERMANN: The question on the left in the context of what Mr. Stockman and I were just talking about seems to be an either/or. Is President Obama a victim of political math here and the inability of what seems to be necessary done or at least part of it done - or is he caving?

ROBINSON: Well, one quick second. I just - I can't help but comment on that last interview. David Stockman -

OLBERMANN: Yes?

ROBINSON: - whose name used to be synonymous with right-wing economic kookiness that was so far out, that people couldn't even - you know, was almost a joke, and he hasn't moved. He's making sense. The Republican Party has moved so far to the right that it has left David Stockman to the left on economic issues. That just leaves me gobsmacked.

OLBERMANN: This was center-left sitting at my right.

ROBINSON: I know. I know, Keith. I know. You know, where did we come in anyhow?

But President Obama - is he caving, or is he dealing with reality?

You know, and maybe a bit of both. The problem is, nobody really knows. You go to the White House, and you get a briefing from senior administration officials, and you try and try and try again to find out, OK, fine. But just tell me, if you're going to cave, that's fine. Just what's the bottom line? What are you guys doing?

And what you get is not a clear answer. What you get is - I was going to say ambiguous, but "ambi" implies two things, one or the other. Polygamous isn't the word.

(CROSSTALK)

OLBERMANN: Non-biguous (ph). Yes. Non-biguous.

ROBINSON: Yes. I mean, it's just all over the map and so you don't know. Is it a trade for unemployment insurance? Is it a trade for the START Treaty? It's just unclear. And if you think I'm frustrated, talk to Democrats on the Hill.

OLBERMANN: Well, and to one of them, let me read this from Senator Tom Harkin. "He campaigned," meaning Mr. Obama, "on allowing the rates for the rich to expire, was very strong on that, and sometimes there are things that are just worth fighting for." And Harkin was asked what if the president compromised on that? "He would then just be hoping and praying that Sarah Palin gets the nomination."

OK. What's he saying there?

ROBINSON: Well, I think - look, you know, you can - you can make the argument that come 2012, you know, most of President Obama's base is going to come home and all is going to be well.

I - you know, I've been traveling a bit on book tour. I've been talking to a lot of people. There is a frustration out there among the president's liberal base in the Democratic Party, you know, about specific policy issues like the middle-class tax cuts, which some people are seeing, frankly, as a line in the sand.

And also about the question of is he or is he not going to fight the Republicans? It's clear which way they want to take the country. Is he going to resist that? Does he have an idea where he's going to take the country?

And you hear more and more of that. And I think Tom Harkin is saying that, yes, sure, all is well if the Republicans run Sarah Palin because she's probably unelectable. But if the Republicans run somebody else, then 2012 could be a kind of whole different scene.

OLBERMANN: All right. What about 2011, based on how the president handled the Republicans while he had majorities in both houses, what happens next month when he doesn't anymore? Is this - are you seeing some sort of template for what's in the near future?

ROBINSON: Well, I don't think we can call this a template yet simply because it's so indistinct and not yet defined. It is - one way the president could go would be to say, OK, for this next two years leading up to the next election, he's going to tack to the right. He's going to make a tactical decision to tack to the right.

And, you know, I actually think that wouldn't make me particularly

happy. And it wouldn't make a lot of people particularly happy. But I

think that that would be preferable to just drifting and being shoved to

the right, being led to the right, being kind of, you know, sent that way

by forces that seem to be outside of his control.

And I think what's very important for the president is to be in charge of this negotiation and this outcome that we're going to have on the tax cuts and on unemployment and on everything else, rather than to seem to be kind of buffeted by forces on the left and the right and just to kind of end up where he ends up. I think that is bad for him politically.

OLBERMANN: Gene Robinson of "The Washington Post," always a pleasure, Gene. Have a good weekend.

ROBINSON: Great to talk to you, Keith.

OLBERMANN: Extending the Bush cats cuts for just 10 more years will cost $4 trillion. On Monday night, "Countdown Special Report," what we know about who America will be in debt to, but what our own government is keeping secret about it. That's a "Countdown Special Report" Monday night.

Tonight, "don't ask, don't tell," John McCain. This is about a military policy. It's not about our economy. Two years ago, he suspended his campaign. Today, he seems to have suspended his logic.

(COMMERCIAL BREAK)

OLBERMANN: He won't agree to a repeal of "don't ask, don't tell" because, quote, "the economy is in the tank." Oh, boy.

The newest face of Governor Jan Brewer's Arizona death panel, as "The New York Times" covers it, calls it death by budget cut. She will join us.

Urban sophisticate versus country philosopher in the conclusion of Thurber's "A Friend of the Earth."

And one of the 10 greatest third basemen ever dies with the voters still having not elected him to the Hall of Fame. Baseball's shame in "Worst Persons."

(COMMERCIAL BREAK)

OLBERMANN: Today, in the Senate Armed Services Committee, there were shades of September 24th, 2008, the day Republican presidential candidate John McCain used the faltering economy as an excuse to suspend his campaign.

In our fourth story: today, Senator McCain declared he would refuse to allow a vote on repealing "don't ask, don't tell," because, quote, "our economy is in the tank." He also said he believed his 41 Republican colleagues would join him in denying equality to gay Americans in the service and block the vote from coming up during the lame duck session. The number's already down to 39.

Yesterday, before Senate Armed Services, Joint Chiefs Chairman Mike Mullen and Defense Secretary Robert Gibbs asked to repeal DADT through legislation so that the courts can't just overturn the law overnight. Today, the service chiefs themselves testified, the Air Force chief asked to delay the repeal for a year. Chief of naval operations and Coast Guard commandant said repeal it away.

Marine Corps commandant, General James Amos acknowledged that openly gay service in the military was inevitable. He asked, though, to essentially delay the repeal until we're not at war.

(BEGIN VIDEO CLIP)

SEN. JOE LIEBERMAN (I), CONNECTICUT: It's possible that Secretary Gates and the chairman might decide not to immediately implement this for Marines and Army in combat, but to do it over a period of time. How do you respond to that, General Amos?

GEN. JAMES AMOS, MARINE CORPS COMMANDANT: Sir, I think that would - this sounds very selfish. That would probably be very - it would probably be acceptable for us.

(END VIDEO CLIP)

OLBERMANN: But can the service chiefs make the repeal of DADT work?

Senator Udall of Colorado asked the question and found consensus.

(BEGIN VIDEO CLIP)

SEN. MARK UDALL (D), COLORADO: I just want to go down the line and ask each and every one of you if we changed this policy, can your branch in the U.S. military make it work? And perhaps I'll start this end of the line and start with Admiral Papp.

ADM. ROBERT PAPP, UNITED STATES COAST GUARD: Yes, sir, I have complete confidence that we could make it work.

GEN. NORTON SCHWARTZ, AIR FORCE CHIEF OF STAFF: As I indicated earlier, we would execute thoroughly, professionally and with conviction.

AMOS: Senator, as I indicated in my written and verbal statement that we will follow the law and execute it faithfully.

GEN. JAMES CARTWRIGHT, JOINT CHIEFS VICE CHMN: I concur.

ADM. GARY ROUGHEAD, NAVAL OPERATIONS CHIEF: We can make it work as do my most senior commanders believe that as well.

GEN. GEORGE CASEY, ARMY CHIEF OF STAFF: I believe we can implement the policy and will implement the policy with moderate risk to our short-term effectiveness and long-term health of the force.

UDALL: Thank you, gentlemen.

(END VIDEO CLIP)

OLBERMANN: And then there is the senator from Arizona. Not satisfied with the opinion of the president, secretary of defense, chairman of the joint chiefs or the opinion of those chiefs that they can make repeal work or the opinion of 70 percent of all enlisted service members who say having a gay member in their unit will have a positive, mixed or no effect on their ability to do their job.

No, today, Senator McCain called on the Senate to kick the can further down the road. He proposed 13 hearings on the subject beginning next year because that was the total number of hearings held when the law was originally enacted. Short of that, the senator promised to take his ball and go home.

(BEGIN VIDEO CLIP)

MCCAIN: I will not agree to have this bill go guard, and neither that will I believe that 41 of my colleagues will either because our economy is in the tank. Our economy is in the tank, and the American people want that issue addressed.

(END VIDEO CLIP)

OLBERMANN: Joining us now, Alexander Nicholson, former U.S. Army human intelligence collector who was discharged in 2002, now the executive director of Servicemembers United and a plaintiff in the Log Cabin Republicans' lawsuit against "don't ask, don't tell." And he was at that hearing again today.

OLBERMANN: Senator McCain wants the process dragged out past the lame duck. How does that sit with you?

NICHOLSON: It's completely ridiculous. I mean, McCain is dragging this thing out longer than any of us ever imagined that even he would.

I mean, first he wanted to have hearings - we had hearings. He wanted to hear from the senior defense leadership - we heard from the senior defense leadership. He wanted to hear from the service chiefs - we heard from the service chiefs. He wanted to hear from the troops - we've heard from the troops.

We just don't know what he's going to ask - there's just not much more he can ask to hear next except maybe hearing from the weapons and the enemy. I mean, we've heard from everyone.

OLBERMANN: I'm sorry to laugh. But it is absurd, isn't it?

NICHOLSON: It is.

OLBERMANN: What do you make of some of the service chiefs' fears about repealing this during wartime?

NICHOLSON: Well, I thought it was interesting to hear the vice chairman of the joint chiefs of staff, Marine Corps general, James Cartwright, say that not only is it OK to repeal it during wartime, but we actually would come out better doing it right now before we drawdown in Afghanistan.

I thought that was the best endorsement you could possibly get from a four-star Marine Corps general, the second highest ranking member of the military. Of course, we already have the first highest ranking member of the military as well as the secretary of defense and the commander-in-chief.

But, you know, I think their views, the other service chiefs, largely reflect personal opinions. I think they largely reflect what they would like to happen. But I think you hit the nail on the head when you showed that clip from Senator Udall going down the line saying this is a congressional decision, and if we decide to do it, can you make it work? And every single one of them had to say yes because they know that they can.

OLBERMANN: Mr. McCain said, in addition to this bizarre comment about the economy being in the tank, that he thought all 41 of his Republican colleagues would join him to oppose this in the defense authorization bill. Senator Brown of Massachusetts said he would vote to repeal DADT. Senator Collins of Maine said if taxes were squared away, she would support repealing it as well.

Are you satisfied with how other Republicans besides Senator McCain with dealing with this?

NICHOLSON: I think a couple of others as well, Senator Voinovich, Senator Lugar, they've all indicated a very reasonable position on this. They've just said, you have a fair and reasonable debate process, time for enough debate on this bill. And you have our vote. That's pretty much been their position.

Senators Ensign and Murkowski have also indicated that they'd be very open after the report came out to going with its recommendations. The report's out. I think we're going to get a good bit of Republican support on this if the vote is structured in a normal - in a fair and reasonable way. So, yes, I think we're very comfortable with that.

Of course, we have almost all the Democrats. I think even Senator Webb now who voted against it on committee seems very comfortable with the report's recommendations. I think Senator Lincoln is going to be OK. And, you know, I'm not quite sure about Senator Pryor, but, you know, with four or five Republicans voting, I think he'd be hard up to try to find an excuse to not vote against it, too.

OLBERMANN: And the last time you were here, you had been critical of the Democratic Congress for not doing more on this, and the president - I think you're getting the answer about how you feel about how the Democrats coming around on it. What about the president?

NICHOLSON: I think the president has done a little bit more. I will give him some credit. He has stepped up and there are been a couple things out of the White House that have been very helpful, certainly more than we got in September.

You know, I tell the White House all the time, I think there's always more they can do. Everyone looks to the president for leadership. It doesn't matter, you know, if it's the public, if it's Congress, if it's the advocacy groups, everyone looks to the president for leadership. And they really gauge the amount or the likelihood of an issue's success on how active he is on it. He's active on START now. He's active on tax cuts. We need to see him more active, of course, on "don't ask, don't tell."

I keep telling the White House, if f what they're doing right now is "x," we need to have 4x, we need to have, you know, three or four times the amount of what the White House is doing. We need at least up to the level of these other issues to show that it's right up there on their priority list. Perception is key here. As we say in the military, perception is reality.

OLBERMANN: And we mentioned Mr. McCain - Arizona's other shame, the Jan Brewer death panel. You will meet another victim. She is 27 years old.

(COMMERCIAL BREAK)

OLBERMANN: Yet another potential victim of what "the New York Times" today called death by budget cut in Arizona has identified herself and joins us next.

First, the sanity break and the Tweet of the day, and this is about the nonsense about Bristol Palin admitting abstinence doesn't work and getting bent out of shape because I said abstinence doesn't work. From Sabrina Brown, "Oh, Keith, Bristol is pissed at you."

To Ms. Brown and Ms. Palin, I worked for ESPN for a total of seven and a half years. Bristol is pissed at me is my default setting. Let's play Oddball.

We begin in Rio de Janeiro, where last week Brazilian police and soldiers held a "Bad Boys II" style raid on one of Rio's biggest drug gangs. More than 40 tons of marijuana, 660 pounds of cocaine seized, along with a cache of weapons and vehicles. But the raid also netted another unexpected treasure, a Justin Bieber mural.

This amazingly realistic image was found in the home of Hedzaio (ph), one of the area's top drug traffickers. Just goes to show that Bieber fever can strike anyone anywhere. It's an epidemic, I tells you. Won't somebody please think of the children? Just say no.

Norway, adventures in live TV. A reporter for government-owned station NRK trying to report. Another man in the back seems very excited that the reporter's here at the stadium. Hi. How are you?

The cameraman does the right thing here and immediately zooms in on the guest to crop out the background. But this nude news enthusiast does not give up so easily. Instead, he turns from flasher to jumping bean. Although he may simply be jumping to stay warm. Either way, where is the Philadelphia Phillie's security guard with a taser when you need one?

Finally, a warning to all you parents out there: with the holiday season upon us, sometimes people put too much pressure on getting the right gift. A child will be thankful for any gift that you are able to give, even books.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Books?

UNIDENTIFIED MALE: Yeah.

UNIDENTIFIED MALE: Books for Christmas? What the heck is that? I don't get books. That's not toys. That's books.

UNIDENTIFIED FEMALE: You hate books for Christmas?

UNIDENTIFIED MALE: Yeah, pooh. I said pooh.

(END VIDEO CLIP)

OLBERMANN: Or maybe not. I guess the Wii right next to him will have to do. In the years to come, everybody got him a sweater, the same sweater every year.

Time marches on.

She is 27. She's battled cystic fibrosis all her life. She was awaiting a lung transplant. Now the state of Arizona has unilaterally cut the insurance program that would have paid for it. Tiffany Tate joins us next.

(COMMERCIAL BREAK)

OLBERMANN: She was diagnosed with cystic fibrosis when she was just four months old. It is a condition that has made it impossible to work full time, impossible to get health insurance. Her lungs will deteriorate with age. So at age 27, Tiffany Tate needs a lung transplant.

But in our third story, if all that were not enough, add one new obstacle, because Tiffany Tate lives in Arizona. And she is just the latest person to fall victim to Governor Jan Brewer and the death panel. She joins me in a moment.

As we have reported on this news hour, Governor Brewer and state Republican lawmakers have cut funding for Arizona's Medicaid program Access, thus denying life-saving organ transplants to low-income patients. Governor Brewer calls the program a Cadillac plan and has defended her death panel by explaining that transplants qualify as Cadillac and optional care.

Tell that to the families of Francisco Felix (ph) and Randy Shepherd. Both men were stripped of their state Medicaid coverage. Now they're trying to cobble together hundreds of thousands of dollars for the organ transplants they need.

You, our viewers, with stepped up to help those men, giving over 110,000 dollars to the National Transplant Assistance Fund on their behalf. The organization helps raise money for transplants, giving Francisco Felix, Randy Shepherd, and the woman you're about to meet, Tiffany Tate, some hope.

You can donate to one of their funds or to anyone's at NTAFund.org, and the number, 800-642-8399.

Joining me now, as promised, Tiffany Tate. She's been denied money for the lung transplant by the state of Arizona. Thanks for some of your time tonight, Tiffany.

OLBERMANN: You were an avid athlete in high school. And you're now a volunteer coach with the high school girls basketball team. So, obviously, in spite of this diagnosis, you've tried to lead as active a life as possible. But can you give us a sense of how this disease, how cystic fibrosis affected you and your family?

TATE: Well, I didn't - when I was younger - you know, I was born with it, basically. It's a genetic disease. So when I was younger, I didn't really feel the effects. I knew I had to do breathing treatments every day. My mom made sure I took care of myself. But they treated me as normal as possible and let me play every sport I wanted to play.

And I followed my brother in his footsteps of playing. He's four years older than me. So I played and then it was about high school that I started to really realize that I just couldn't keep up as well as, you know, the rest of the kids.

I was on varsity as a freshman. You know, our team was very, very good. We won back-to-back state championships my freshman and sophomore year. It definitely took a toll on me, as far as I was roughly around 45 to 50 percent at that point in high school. And then it's just kind of slowly progressed ever since.

And now, you know, I'm at that point, and the doctors talk to me about, you know, getting - possibly getting a lung transplant because I'm at that point in my lung capacity. I'm only at roughly 25 percent lung capacity left. So yeah.

OLBERMANN: So they put you on this list in April. And then in August, you get this letter from the Access people, the local Medicaid telling you that you would no longer be covered. Can you give us some sense of what that letter felt like to receive?

TATE: Yeah. I got the letter. It was incorrect, the letter that we got. They said they weren't going to cover my liver transplant, which would be great. I'm not asking for a liver transplant.

But it was tough. It was tough because from April to August, I really got to talk to a lot of transplant survivors and a lot of people that just said how amazing they feel after transplant and the life that they get to live after transplant, being able to hike and do all those things.

It got me really excited to know that I was going to be able to get my new lungs and do things that I've never done. To hear that was absolutely devastating, to know that I wasn't going to - I mean, I wasn't going to get it.

OLBERMANN: The governor, although there has been a lot of motion in Arizona towards going back and putting everybody who was taken off the list, the 100 or so people who were taken off these lists, putting them back on. The governor has refused to call the special legislative session to reverse the decision now. And she defended the budget cut, and the statement was "the state only has so much money."

You have the floor. Is there anything you'd like to say to her or to the members of the legislature in Arizona?

TATE: I just want to ask where in the budgets - where is that more important than a human's life?

OLBERMANN: Yes. I don't think it has to be more expansive than that. Last point, a positive point. Your basketball team has been extraordinarily supportive of you. Again, you have the floor. What would you like to say to your girls?

TATE: I'm just - I'm just blessed to be a part of the Seton community at Seton Catholic High School. They've embraced me. And we're a big, huge family there. I love all my kids. And I love that high school. I mean, they are just a huge part of my life.

And they make me, you know, just feel so happy to be alive. They give me a purpose of - to help them and to, you know, mentor to them as young women. It's just - I'm just extremely lucky to still be able to have a part in the passion of my life, which is basketball, and to be able to help young women in their journey in their lives.

OLBERMANN: Tiffany Tate, the assistant girls basketball coach at Seton Catholic Prep. I don't know what to say besides thank you for being so forthright and public about this, and on behalf of our viewers to wish you the best.

TATE: Oh, thank you so much for having me on the show.

OLBERMANN: Of course.

See the guy in the background here? He's a gas station employee.

He's helped solve a crime and of course he's going to be severely punished.

The big showdown between James Thurber and Zeff Legin is finally here in the conclusion of Thurber's "A Friend of the Earth."

And when Rachel joins you at the top of the hour, if you thing the tax cut votes and the Ohio State fight song have nothing in common, she'll fix you on that.

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OLBERMANN: The showdown was inevitable from the beginning, a kind of small-town Connecticut Will Rogers versus the actual small-town Connecticut James Thurber. The conclusion of Thurber's "A Friend of the Earth."

First, get out your pitchforks and torches, time for today's nominees for the Worst Persons in the World.

The bronze goes to the Hess Oil Company. Its convenience store at the gas station at Emerson Street and Phillips Highway in Jacksonville, Florida, was robbed. What you're looking at here is the alleged knife-wielding perpetrator walking off with the cash register and then alighting towards his own vehicle.

The figure in the back there is Clerk Keith Ireland running after him, throwing a two-liter bottle of Coke at the guy, and most importantly getting the number of the license plate on the car. The suspect was arrested and the clerk, Mr. Ireland, was rewarded by Hess by getting fired, fired for, quote, "leaving the work area without permission."

Our runner-up, Senator Scott Brown of Massachusetts, after insisting that when it came to extending unemployment benefits through next year for up to five million Americans, 60,000 of them right now in his own state, quote, "more than anybody here, I want to help." Brown then personally blocked a one-year extension of the benefits, saying he had, quote, "just found out about it."

He then went back to planning his 100 dollar a ticket Christmas party at Boston's Park Plaza Hotel. I told you about this guy. But you didn't believe me. Why didn't you believe me?

But our winner is once again the writers and veterans committee who elect the members of Baseball's Hall of Fame. Between his debut in 1960 and the end of his career in 1974, Ron Santo of the Chicago Cubs hit 342 home runs and drove in 1,331 runs, more than anybody else in that era who did not play first or the outfield. In 13 full seasons as a third baseman, he won the Gold Glove as the best fielder in his position five times.

The first year he was eligible for the Hall of Fame, the writers gave Santo four percent of their vote. After 18 years, they were all the way up to 43 percent. Getting in is 75 percent.

The veterans committee, which is supposed to correct the writers' many mistakes, never did. Ron Santo died last night at the age of 70, one of the top ten third basemen in history, and he never got to hear the words "you've been voted into the Hall of Fame, Ron."

The electors of the Baseball Hall of Fame, whose voting has all the validity of sending in the most box tops from cereal packages, today's Worst Persons in the World.

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OLBERMANN: When 41 years ago, NBC admirably tried to turn the writings of James Thurber into a sitcom staring the great William Windum, the tenth story they chose as the basis for an episode was "A Friend of the Earth." There is something existential about the battle of wits Thurber describes. He appears in the story as himself of "the New Yorker."

His nemesis is Zeff Legin, the corn pone (ph) handyman out of Ludlow, Connecticut. Zeff's shtick is to tell a new acquaintance lost my wife ten years ago. Then as sympathy is exuded, punch it out with yeah, lost her in a dry goods store. I slipped out the backdoor.

Thurber hates his guts. But in their battle of wits, Thurber is losing. And he had no hesitation in admitting this in "Thurber Country" in 1949. The conclusion of "A Friend of the Earth." by James Thurber.

"Zeff fixed the studio floor about two weeks later. I heard him sawing and nailing with long intervals of silence in between. But I didn't go out to the studio to see how he was getting along. I confess there was more to this than my instantaneous annoyance at the sight of the man. I was afraid of his tongue.

He had thrown me over his shoulder easily and in public. He was in the studio most of the afternoon. If I had hoped that he would go away without dropping in on me, I was doomed, as the saying goes, to disappointment. Zeff never knocked on anybody's door, he just opened it and came in. He found me in the living room.

"Job's done," he said.

"So soon," I snapped?

He pulled the flashlight out of his pocket, walked over to my chair and handed it to me.

"Thanks," I said unamiably. "Send me a bill for the carpentry."

"Got it right here," said Zeff and he handed me a slip of paper. I glanced at it and it seemed reasonable enough. Then I clicked the flashlight. It didn't work.

"It doesn't work," I told him. He twinkled and grinned.

"Needs new batteries," he said. Should have known better. I should have said nothing. But once again, I walked into his little trap.

"You said you would take it to Barton's and have it fixed," I told him.

His eyes crinkled. "Nope," he said. "Told you I was going by.

Didn't say nothing about stopping in."

That was too much for me. I brought the flashlight down with great force on the edge of a table and smashed it to bits. Then I turned slowly to Zeff Legin, my eyebrows up in feigned astonishment.

"Defective," I said coldly. Zeff took his harmonica out of his pocket and rubbed it with the palm of his hand. He had lost the twinkle and the grin. It was a moment rare, perhaps unique in the life of the great philosopher. Zeff Legin couldn't think of anything to say.

He walked out of the room playing "Nelly Gray" and that was the last time we ever spoke to each other. I've got a guy named Larkin from Danbury whenever anything around the house needed fixing.

I think it was in September that the Ludlow Men's Forum decided to ask Zeff LEgin to be the principal speaker at their monthly meeting. I saw the announcement in the Ludlow journal. It said Efram Legin, Ludlow's most beloved citizen, had consented to address his neighbors and to share with them his rich and salty wisdom and his profound knowledge of life.

The title of his talk, the journal said, was "A Friend of the Earth." . The forum meetings were held in the small chapel across the street from the congregational church. There were about 40 of us present when, after the reading of the minutes of the previous meeting and the reports of various chairmen of committees, a smiling Paul Morton stood up to introduce the speaker of the evening.

It was an introduction dripping with marmalade and ornamented with flowers. And everybody loved it. And everybody laughed and applauded as Zeff got slowly to his feet.

I had seen him only once or twice in passing since the incident of the shattered flashlight. I had felt ashamed about that show of temper, and I hadn't even told my wife that I had broken the lamp deliberately.

Zeff let his eyes roam upon the room. They fell upon me at last in a chair near a wall in a row at the back.

"Neighbors," began Zeff, "I ain't always been like you good folks that's nice enough to thank me, a man of philosophy and easygoing nature. There was a thing happened when I was a young fellow that set me on the right path, you might say. My father gave me a flashlight for Christmas one year, and the batteries wore out, like they is bound to do if a man aims to see more in his life than the good lord wants it to.

"So I gave the flashlight to an uncle of mine because he said he'd get it fixed for me. Well, he didn't exactly say he'd get it fixed for me. I'm a going by Burke's store, he says, where they has batteries. You want me to take it along? So I says that would be very kind of him.

"But he brung it back that evening and it wouldn't work when I clicked it. Needs new batteries, says my uncle. When I told him he promised to have it fixed, he said, never said nothing about having it fixed. Said I was going by Burke's store. Didn't say I was stopping in.

Well, sir, like many a man young or old that ain't grown up - and some of them never does - I lost my temper. I see him red and I smashed that there flashlight into 1,000 pieces. I realized in a second this wasn't no way to act to a man of greater age and more common sense than me, so I turned it off with a joke.

I turns to my uncle and I says, solemn-like, defective, I says.

Then I got up quietly and quickly from my chair and started to slip out of the chapel. A number of the men turned and stared at me. And several frowned and said, shh. Bill Logan plucked me by the sleeve as I passed his chair. "Are you walking out on Zeff," he whispered?

I leaned down close to his ear, "yes," I whispered, "forever." I had intended to spend the winter in Ludlow, but business took me back to the city. Or at least I told Paul Morton and the others that business took me back to the city.

My wife knew better, of course. She knew that Zeff Legin was behind my determination to get out of Ludlow and stay out. Several months went by before I got up enough courage to tell her about the flashlight and Zeff Legin's opening remarks on the night of the forum meeting. To my surprise and delight, I discovered that I was able to laugh with her about what she called my straight-set defeat at the hands of the philosopher of Ludlow.

She has promised, however, never to tell the Mortons about it. Or Bill and Lucy Logan. I don't think I could stand that."

"A Friend of the Earth" by James Thurber.

That's December 3rd, 31 days since Republicans took control of the House. Mr. Boehner, where are the jobs?

I'm Keith Olbermann, good night and good luck.

And now a perfect segue for Mr. Thurber of Ohio State University to a discussion of what the Dems and Script Ohio have in common, ladies and gentlemen, here is Rachel Maddow. Good evening, Rachel.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END